The life span of a corporation can be set as a finite period or perpetual. Which option best reflects this?

• A. It must be finite.
• B. It must be perpetual.
• C. It cannot be varied once set.
• D. The life span can be set for a finite period or perpetual.

Answer: (D)

Corporations can be created with either a finite duration or perpetual existence, and the duration can usually be changed by amendment to the charter. You might set a finite term that ends automatically unless extended, or you can choose perpetual existence that continues indefinitely until dissolution. This flexibility is why the best statement is that the life span can be set for a finite period or perpetual.

Choosing only finite or only perpetual would not fit in all cases, and the notion that the duration cannot be varied after formation is incorrect because amend­ments to extend or change the term are generally possible.